Meralco passes on audit

Man at the Market

Jesse E.L. Bacon II

08/29/2008

If Meralco, the giant power distribution firm of the Lopez Group, continues to parry any effort at having its financial books audited by the Commission on Audit (CoA) after readily agreeing to it publicly, the company it may just be digging its own grave, even if it has not realized it.

When pressure was mounting for Meralco to submit its financial books for examination by CoA auditors, company officials publicly announced their being amenable to the idea. But when the CoA tried to move in to perform its assigned task, Meralco backed out from its commitment. Its justification was that as a private entity, Meralco’s books are not subject to audit by State auditors.

What Meralco had conveniently withheld from the people was that the audit of its books was ordered by the Supreme Court (SC) no less in the Meralco vs. Genaro Lualhati case. Many are not aware of this fact, and Meralco does not want this fact made known to the public.

In that cited case, the SC approved the provisional rate increase Meralco applied for in 2003 on the condition that the power distribution firm must first justify said increase by way of an audit by CoA of its books. So, the clamor for the CoA audit of Meralco’s books is therefore not capricious and whimsical but emanates from an SC order no less.

Apparently, however, Meralco must have been terribly terrified with the prospect of having its books perused by government auditors, hence, its being up in arms against CoA. And simple logic would tell us that one becomes terrified only under this circumstance if skeletons are kept in its closet, so to speak.

This columnist is not irritated, much less rattled, every time he is requested to have any compartment of his car opened for inspection by private security guards or even the police because he is sure he is not hiding anything illegal inside his car. Fear to open one’s car for inspection sets in when you know you have something illegal in your possession. Similarly, Meralco seems to be shivering in fear with the prospect of a CoA audit of its books maybe because there is something they don’t want discovered by CoA.

Fanning Meralco’s fear even more is the syndicated estafa case the Justice department had recently filed against 17 of its corporate officials led by its board head and chief executive officer Manuel “Manolo” Lopez. Considering that this case is non-bailable on account of the magnitude of the amount involved, a whopping P899 million, there is enough reason Meralco had an unexplainable change of heart in regard the audit of its books as ordered by the Supreme Court.

This syndicated estafa case is the result of Meralco’s collection from its consumers bill and meter deposits that the court ruled was illegal. The entire amount including its interest is being ordered returned to the consumers a long time ago but remained unimplemented for reasons only known to Meralco’s officialdom.

Meralco’s defense that the Justice department was unfair to the company when it allowed the complainant in this syndicated estafa case, Nasecore, a non-government electricity watchdog, to have their complaint filed in court despite the groups’ failure to pay the docket fees is not a sound defense in reality. In this particular point, Meralco is again conveniently forgetting the justice principle on pauper litigants.

Nasecore is simply a watchdog. But as such, it has all the rights to hale Meralco to court over issues such as this syndicated estafa. Since it is just a watchdog, the Justice department ruled that it can file its case against the giant power distribution firm as a pauper litigant thus exempt from the payment of the P8.9 million filing fee.

Instead of focusing on this flimsy defense, perhaps it would be good for Meralco to zero-in in its arguments the substance of the complaint which is that whether it has committed the crime of syndicated estafa or not. It is in this regard that Meralco should focus its energy on.

(jelbacon@yahoo.com for reactions)

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